cashman73 writes: Amazon dropped a bomb on the publishing world Wednesday morning by announcing a new royalty program that will allow authors to earn 70 percent royalties from each e-book sold, but with a catch or two. The move will pay participating authors more per book than they typically earn from physical book sales so long as they agree to certain conditions—conditions that make it clear that Amazon is working on keeping the Kindle attractive in light of upcoming competition. Still, authors and publishers are split on how good this deal really is.

Amazon's old system will remain in place for those who don't want to participate in the new arrangement, but the carrot to upgrade is pretty attractive—a typical $8.99 book would pay an author $3.15 under the "standard" system, while an author or publisher would get $6.25 under the new 70 percent scheme.

The catch, however, is that authors or publishers must list their books for between $2.99 and $9.99 on the Kindle. A majority of Kindle books already fall into this range, but authors are able to set prices higher if they want, and some do.

The price must also be at least 20 percent below the lowest list price for the physical book, the book must be available in all geographical areas where the authors has rights, it must include all features of the Kindle store (including text-to-speech capabilities), and the Kindle price must be the same or below the price offered at other e-book stores.